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FAQs Frequently Asked Questions

Trading Volatility Report
Understand the risks involved in trading UVXY 620 MACD before risking any money.
Q: In the trading volatility report, it suggests to buy UVXY at a particular price. I did not buy on at that day. The closing price that day was lower than the suggested price. Is it suitable for me to buy UVXY around this lower price on Monday? Or is it better to wait for the next time when the 6 period EMA crosses 20 period EMA? Or when the fast line crosses above the slow line?

A: To be clear, we are not providing signals, as members should understand this method in order to implement it themselves. We will, however, send out reports as guidance to assist in the learning process. But bottom line is that UVXY moves so fast sometimes that one generally has to be watching it and acting on it based on what they're seeing themselves in real-time. Otherwise, an email report can often be late.

The strategies discussed on VoSI should be used as a guide to tailor a strategy that fits your trading personality and risk/reward tolerances. Each investor must discover for themselves based on their individual trading personalities where best to set trailing stops, when to take profits, and when to cut losses. That said, we have and will continue to provide some guidance on these issues.

UVXY is highly risky as it can easily move several percent in a few minutes or less when it is launching or when it is correcting after a big price move.

Just because the UVXY starts to trade below the suggested entry price does not always mean it becomes more buyable, the same way a stock does not necessarily become more buyable just because it falls in price. Context is key. One must stay alert to changing conditions. Further, entry points when the 6 period EMA crosses 20 period EMA are often late entries thus may pose higher risk. The fast line crossing above the slow line in the MACD portion of the graph generally offers cleaner entry points. But again, there are no hard, static rules on when to buy and when to sell UVXY.  

In other words, one should never buy blindly just because the fast line crosses above the slow line or because the the 6 period EMA crosses 20 period EMA. One must consider market conditions in context with how the UVXY is trading to determine entry points.

That said, as we have discussed in prior reports, one will generally encounter more false signals than profitable signals. But gains, at least since the summer of 2017, can more than make up for the small losses which are typically kept to 1% or less.

First published: 8 Oct 2017
Last updated: 9 Oct 2017